Broomfield seeing apartment boom

MULTI-FAMILY PROJECTS
Pending and recently approved multi-family residential projects in Broomfield:

Project -- Location -- # of Units

Alta Harvest Station -- Allison Street/Harvest subdivision -- 297

AMLI (Interlocken) -- 25 International Court -- 343

Arista (Parcel N) -- 11465 Uptown Ave. -- 272

Broomfield Business Center -- 13700 Via Varra -- 374

Camden Flatirons (Interlocken) -- 120 Edgeview Drive -- 424

Wasatch -- 12060 Perry St. -- 302

Northlands -- 423 and 495 Colo. 7 and 17200 N. Huron St.-- 325

Arista (Parcel X) -- 11302 Central Court --166

Source: City and County of Broomfield

Low vacancy rates, access to major transportation corridors and a steady job market are helping make Broomfield a hot spot for new apartment development in the metro area. For evidence of this fact, look no further than the more than 2,500 apartment units developers are seeking to build in the city as of this month.

There are eight multi-unit projects in various stages of planning and development in Broomfield, most centered on the U.S 36 corridor, according to the Community Development Department. All told, those projects -- which vary from being under construction to just entering the city's development review process -- could add 2,503 apartments to Broomfield's rental housing market.

"I would have to say it is the largest amount of multi-family (activity) we have seen in a relatively concentrated period of time," Deputy City and County Manager Kevin Standbridge said this week of all of the commotion surrounding apartments in Broomfield. "You're seeing it predominately in areas that will be served by transit in the future or near major employers, which are both great things in our view."

Of the eight apartment projects proposed for Broomfield, two have received full approval from city officials and are under construction. The first is the Arista Uptown Apartments, a 272-unit project being built by Smith/Jones Partners, LCC near the corner of Arista Place and Uptown Avenue south of U.S. 36 in Arista. The second is the AMLI Interlocken development, which plans to add 343 units developed by AMLI Residential Construction, LLC on 12.2 acres southwest of the intersection of Interlocken and Eldorado boulevards.

AMLI Residential, headquartered in Chicago, specializes in luxury condos and apartments and operates in 121 markets across the United States, said Andy Mutz, the company's vice president of development. Of its six established communities in the Denver area, two are in Broomfield, including the recently acquired Summit at Flatirons apartments, now AMLI at Flatirons, Mutz said. The developer likes the U.S. 36 corridor, and specifically Broomfield, Mutz said, for the steady job market in the area.

"Job growth is kind of lagging in this recovery, so in all of our markets we a trying to target the specific markets with the greatest opportunity for growth," Mutz said. "In Denver we really think it's the U.S. 36 corridor. We really like the industries that are locating there; the clean energy industries."

Over the past decade, Standbridge said he feels the city has done a good job of balancing new residential development between single-family homes and multi-unit development, but city staff and other observers know low vacancy rates are helping fuel the city's multi-unit feeding frenzy.

In the fourth financial quarter of 2011, the metro area's apartment vacancy rate fell to 5.2 percent, the lowest fourth-quarter figure since 2000, according to a report by the Apartment Association of Metro Denver and the Colorado Division of Housing. The same reports list the fourth quarter vacancy rates for the Broomfield/Boulder area at just 4.4 percent.

"It would seem that demand for rentals right now would fit the demand for professionals in that part of the (metro area)," Colorado Division of Housing economist Ryan McMaken said of the tight vacancies in Broomfield and Boulder. "We know there is a lot of job growth in that part of town and a lot of innovation."

While it might not look it from an insider's perspective, McMaken said the U.S. 36 corridor and the Fort Collins area are among the strongest job markets in the United States right now, leading to more migration and higher demand for rental housing. Another factor McMaken said is likely fueling demand is a growing trend of young professionals staying in rental housing longer than the last decade, when they might have bought homes, coupled with little to no growth in area residents' average incomes.

The high demand coupled with the wait as developers eye adding to the rental housing supply has spurred another growing statistic in the Broomfield area, McMaken said -- rental cost growth. Median rent in the Broomfield/Boulder area was $993, according to the rental vacancy report from the fourth quarter of 2011. That's a 3.7 percent increase from the $958 median rent in the fourth quarter of 2010. In the last two quarters of 2011, McMaken said average rents in Broomfield jumped from $946 to $981, a 3.6 percent increase -- outpacing the approximately 3 percent average rent growth being experienced across the western United States. In a report posted to the Colorado Division of Housing Web site on Feb. 14, McMaken highlighted that construction permit requests for multi-family development in Colorado jumped by 89 percent in 2011 vs. 2010, but even increased production might not slow rent growth for some time.

"Demand will continue to outpace supply for some time, and it doesn't look like (contractors) are over-building at this time," McMaken said. "Even with a lot of production over the last couple years, if we see another new wave of new households forming in Colorado, we might see more rent growth."

Affordable hosing has been an ongoing concern for Broomfield City Council, but none of the eight multi-unit developments seeking to build in Broomfield would featured subsidized rents, with rates being set by the housing market, Standbridge said. Both the Arista Uptown and AMLI Interlocken projects are focused on building luxury apartments, with rents likely to range from $800 to $1,250 for a one- or two-bedroom apartment in the Arista development and perhaps even higher in the AMLI project.

"I don't think it's a concern that we're adding market-based units," Standbridge said. "But we would like to see more affordable units, and certainly we'll be working toward those."

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Broomfield seeing apartment boom